Analyst: Apple wants Snow Leopard to take bite out of Windows 7

It’s interesting that Apple is offering its new operating system, OS X Snow Leopard, as a $29 upgrade. It’s so cheap – I probably spent more than that on coffee last week.

That’s way less than the $129 price tag Apple put on upgrading from Tiger to Leopard two years ago. But Leopard was much more of an update than Snow Leopard will be.

As Microsoft Blog readers pointed out Monday, many people view Snow Leopard simply as a service pack – that it’s a low-importance update to Leopard. Other readers countered that many people view Microsoft’s upcoming Windows 7 simply as a service pack to the unpopular Windows Vista.

Piper Jaffray analyst Gene Munster doesn’t disagree, but in a recent note to investors suggested that view isn’t bad for Apple. In fact, he said, with Snow Leopard’s relatively low significance, Apple is trying to undermine Windows 7, according to All Things Digital.

“We believe Apple is using a minor upgrade to its operating system as an opportunity to sell it at a lower price and market the new OS as a selling point for the Mac platform over the Windows platform,” Munster wrote, according to All Things Digital. “In other words, Apple is promoting the Mac platform as a superior alternative to Windows in terms of newer technology, more frequently, for less money.

“The release of Snow Leopard is not about new features; rather, it is about keeping Mac users up to date with the latest technology versus Windows XP and Vista users on antiquated technology.”

It’s the perfect counter to Microsoft’s “Laptop Hunters” ad campaign that hammers away at the fact PCs are generally cheaper than Macs. Munster seems to think Apple is saying, “Hey, our hardware is better, hence more expensive, but our software is cheaper and more up-to-date.”

Snow Leopard will hit shelves on Friday. People not upgrading from Leopard will have to pay $169 for a single license, or $229 for the five-license family pack. (Snow Leopard, by the way, will only work on Intel-chipped Macs.)

Windows 7 is scheduled for release Oct. 22. The lowest-cost upgrade from Vista is $120 and the lowest-cost single license is $199.